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Perverse ethanol incentives breed more gas-guzzlers

Wednesday, March 28, 2007

President Bush and other ethanol proponents claim that pushing alternative fuels will reduce U.S. gasoline consumption. By developing a fleet of flexible-fuel vehicles that can burn E85—a fuel that consists of 85% ethanol and 15% gasoline—some say that the United States will be able to replace many of its gasoline imports with domestic fuel production.

But the Alternative Motor Fuels Act established in 1988 may negate these perceived benefits by allowing lower mile-per-gallon standards for E85 compatible vehicles. Since it is often cheaper to produce flexible-fuel vehicles than to produce fuel-efficient ones, American automakers have eagerly jumped onto the ethanol bandwagon. According to BusinessWeek, a larger proportion of gas-guzzling “alternative” vehicles could result in more gasoline consumption, not less.

A lack of E85 filling stations only adds to the problem. If consumers only have gasoline to choose from, it does not matter whether or not their cars can burn ethanol. Less than one percent of U.S. gas stations currently sell E85.